ifc performance standard 2 labor & working conditons presention to unions, istanbul april 5,...
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IFC PERFORMANCE STANDARD 2 LABOR & WORKING CONDITONS PRESENTION TO UNIONS, ISTANBUL APRIL 5, 2013. Performance Standards Overview. PS1: Assessment and Management of E&S Risks and Impacts. PS4: Community Health, Safety and Security. PS2: Labor and Working Conditions. - PowerPoint PPT PresentationTRANSCRIPT
IFC PERFORMANCE STANDARD 2LABOR & WORKING CONDITONSPRESENTION TO UNIONS, ISTANBUL APRIL 5, 2013
2
PERFORMANCE STANDARDS OVERVIEW
PS1: Assessment and Management of E&S
Risks and Impacts
PS2: Labor and Working Conditions
PS3: Resource Efficiency and
Pollution Prevention
PS4: Community Health, Safety and Security
PS5: Land Acquisition and Involuntary Resettlement
PS6: Biodiversity Conservation and
Sustainable Management
of Living Natural Resources
PS7: Indigenous Peoples
PS8: Cultural Heritage
PS2:
LABOR AND WORKING CONDITIONS
ILO Conventions Child Labour Forced Labour Non-Discrimination Freedom of Association &
Collective Bargaining
SCOPE
ObjectivesFair treatment, non-discrimination, equal opportunityGood worker – management relationshipComply with national employment and labor lawsProtect workers, in particular vulnerable categoriesPromote safety and healthAvoid use of forced labor or child labor
SUMMARY OF REQUIREMENTS
1. Human Resources Policy2. Document and Communicate Working
Conditions and Terms of Employment3. Respect Collective Agreements4. Workers’ Right to Organize and Bargain
Collectively5. Non-discrimination and Equal Opportunity6. Retrenchment Plan7. Grievance Mechanism8. No use of Child Labor9. No use of Forced Labor10. Safe and healthy work environment
PS2: 2012 CLARIFICATIONS & UPDATES
Comparable conditions for migrant workersRequirements for workers’ accommodationMonitoring of conditions for workers younger <18Alternatives analysis prior to retrenchmentThird-party worker access to grievance mechanismSafety requirements for primary supply chain
(NB many of these changes were proposed by unions during consultations and adopted, in full or in part)
SUPPLY CHAINS
Triggers: Where there is:• High risk of child labor and forced labor• High risk of significant safety issues (life threatening) in the primary supply chain Requirement: Client required to introduce procedures and develop mitigation measures Implementation: Any projects with high E&S risk supply chains will be categorized ‘A’, e.g. commodity / country combinations with Biodiversity, Deforestation, Child Labor risks Examples: palm oil in Indonesia, cocoa in West Africa, cotton in Central Asia, soy/beef from Brazil (Amazon - Cerrado)
Tools: GMAP, Maplecroft
Aim: To protect workers, including vulnerable categories of workers such as children, migrant workers, workers engaged by third parties, and workers in the supply chain
CONVERGENCE OF STANDARDS
• 78 financial institutions have adopted the Equator Principles to date, incorporating application of PS 2
• EBRD’s PR 2 based on PS 2 and near identical
• MIGA and IBRD adopted IFC PSs for private sector projects, ensuring World Bank Group coherence (as lobbied for by global unions)
• OECD Export Credit Agencies benchmark against PS 2
• European Development Finance Institutions apply PSs when more than one EDFI is involved in a financing
DUE DILIGENCE PROCESS Scope of
application All FIs excluding PE funds and global trade
finance projects All direct investments excluding companies
with very low E&S and labor risks (e.g. small IT or Telecoms company)
Due-diligence Send and review a questionnaire covering PS 2 aspects
Request & review key HR policies, as required Meet with / Seek clarifications from HR
department Seek documentary evidence (e.g. sample
employment letter) Visual observation during appraisal visit (e.g.
use of PPE) May meet with staff and/or union members May request or undertake a labor audit
Addressing gaps & following up
to ensure implementation
of mitigation
Corrective Action Plan – close all gaps in reasonable time
Tie implementation to investment agreement (enforceable)
Follow-up: a) disbursement, sign-off, b) site visits and/or c) review of annual E&S / Labor monitoring reports
May request labor audit in high-risk situations
IMPLEMENTATION TOOLS Internal Resources• Internal resources: Labor Toolkit, PS 2 training for
Specialists, Labor working group (virtual)• Templates: grievance mechanism, disciplinary
practices, non-discrimination etc to assist Clients• PS 2 ‘champions’• Various sources of PS 2 info, e.g. US Dept Labor List
of Goods Produced by Child Labor or Forced Labor
External Resources – Good Practice Publications• Addressing Child Labor in the Workplace & Supply
Chain (2002)• Managing Retrenchment (2005)• Non-discrimination & Equal Opportunity (2006)• Workers’ Accommodation – Processes & Standards
(2009)• Measure & Improve Your Labor Standards
Performance: PS 2 Handbook for Labor and Working Conditions (2010)
GLOBAL IFC-UNION INTERACTION
Unions substantially involved in formulation of PS 2 in 2004-6 and again in the PS 2012 update (+ ILO)Global union review point for new E&S disclosure documents exists – union concerns over timingDedicated website for raising union concerns on proposed new investments: ~ 30 projects highlighted to dateSome union complaints directed via the Compliance Advisor Ombudsman (CAO) mechanism ESG Department representative meets 2-4 times a year, as informal contact in between on PS 2 mattersDifferences of opinion generally concern implementation of PS 2 requirements, not content
WEBSITE
REGIONAL ISSUES & CHALLENGES• 2 CAO complaints in Turkey (Assan Aluminium and
Standard Profil), both about Freedom of Association (not respecting workers’ rights to join and form unions)
• Dealing with the aftermath of the Arab Spring (multiple and ongoing strikes, union issues)
• Worker Health & Safety in many jurisdictions, e.g. in Turkey in construction
• Privatizations / retrenchment (e.g. Albania, Lebanon…)
• Least developed (IDA) countries: lack of Govt capacity, enforcement on labor, low incentives, union issues